I think it's cool they funded people in so many different places, although in terms of getting people together to share ideas and have intense mentoring, Y Combinator's strategy is probably better.
That doesn't mean this doesn't have a shot, though - maybe they'll get some good people who simply can't pick up and move to SV or Boston.
It's not a zero sum game in any case, I hope they both do well!
There is such an enormous demand for this type of funding that I hope to see many, many more YC style seed stage funding companies. I wish there was a way to make the model work for biotech but I haven't figured it out yet.
What is different in the case of biotech? Can you elaborate? Why do you think the model doesn't work? Do you need equipment? Or is your biotech startup purely based on software?
#1: Institutional investors in biotech require patents for funding. Period. Without a patent, there is no funding. If you don't have a patent, you're probably stepping on someone else's IP. Unlike software patents, life science patents are real and enforceable.
#2: There are regulatory issues for most biotech startups. This means you may need 3 years of cash to burn before you have a chance of seeing revenue.
#3: Startup costs are all around higher. Just about always, biotech startups need specialized high end lab equipment in very specific lab spaces. The only lab I've found that will take me is in San Jose and is $3,000 a month. The _only_ commercial lab space in Pittsburgh is with a state sponsored institutional investor and they only give space to portfolio companies.
A YC for biotech would need to be a true incubator with office/lab space. And you'd have to give each team $100,000. In biotech, $100,000 is equivalent to the "living expenses only" money that YC gives out.
It could very well work and I'd love to see it but someone would have to put up a very, very large amount of capital for something very risky by the standards of biotech investment.
Very interesting. After all these difficulties, what attracted you to biotech so much? I'm really curious. Is it primarily an intellectual/scientific curiosity or a desire to help people or the business aspect of it or...?
For me, about $6,000 in equipment and reagents, office space that can be converted into a basic lab, and a whole lot of lawyers. I'm going into a biotech area (genetic testing) with almost no regulation or governmental oversight, which changes the game just a little.
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